Why Do Governments Have So Much Difficulty Dealing With Troubled Banks?

The latest spate of banking problems in Italy highlights the rather remarkable truth that governments have enormous difficulties dealing with banking crises. This situation prevails despite decades of experience on what not to do and what works in terms of bailouts. The Italian crisis has all the classic symptoms of poor banking practices, weak supervision and uncomfortable options when things go bad.

Author:
Danny Leipziger

Publication Type:
Economic Viewpoint

Publication Year:
2016